ControlVariableTRTCπMRMCMπ00001901080901080217030140802060324060180703040430010020060402053501502005050063902101804060-2074202801403070-408440360802080-60945045001090-8010450550-1000100-100Preview__________________________________________________________2. Comparing Benefits to Costs (continued)-The Marginal Principle-Illustrating totals and marginalsb. Continuous Decisions1. The idea of a derivativeLECTURE______________________________________________Definition: The Marginal Principle: To maximize total profits, the manager should increase the managerial control variable to the point where marginal revenues equal marginal costs. Graphically, this can be illustrated both by graphs of totals and of marginal changes:Total changes2

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